First, we’re so sorry for your loss. This can be a very challenging time for many reasons, and dealing with property ownership is tough at the best of times.
You’re thinking, “I inherited a house, what to do with this house?” Should I rent it? Should I sell it? How should I sell it?
Tons of options open for you, but…
… we can help.
We’re seasoned investors in Minnesota real estate, and we’re looking to buy several houses each month in the Minnesota Minnesota area. Every month we get calls from those who have inherited a house and are looking to sell the house… so the info below are some tips to help you navigate the process.
I Inherited A House, What To Do Next?
Here’s a few important considerations to help you make the right decision:
1) Make sure the mortgage is paid.
It is important to note that if the individual who left you a property had a mortgage on it, you will be responsible for paying it, unless it was fully paid off. In the case that you wish to keep the property, certain banks may permit you to take over the existing loan, while others may require you to refinance the mortgage into a new loan. However, if you are ineligible for a new loan, renting the property may not be a viable option for you.
2) The investment is only as good as the manager.
If you find that dealing with the various aspects of property management, including brokers, maintenance, tenants, and rent collection, is taking up too much of your time, it may be beneficial to hire a professional to assist you or consider selling the property. While keeping an inherited home and renting it out for additional income is a sound strategy, it is essential to understand that managing a property comes with its own set of challenges, including tenant and maintenance issues. Therefore, you must be prepared to handle these hassles and have a plan in place for how you will manage them before deciding to rent out the property. Alternatively, if you do not wish to take on the responsibility of property management, selling the home may be a better option for you.
3) Property ownership costs money.
Inheriting a house in perfect condition is a rarity, and most properties require significant improvements. Therefore, it is essential to consider hiring a professional property inspector who can provide you with a comprehensive evaluation of the property’s condition and inform you of any necessary repairs or renovations that need to be completed within the next five years, along with estimated costs. This step is crucial in avoiding any unexpected expenses that may arise later on, as unforeseen surprises can be incredibly costly. By being aware of the property’s condition and having a clear understanding of the necessary improvements, you can make informed decisions and prepare financially for any future repairs or renovations that may be required.
4) Selling a property for top dollar costs money.
If you don’t want to deal with making repairs, updating kitchens, improving landscaping and overall cleanup, don’t worry. We buy Minnesota houses for cash, as-is.
5) If the market will continue to grow faster than your other options, hang on to the investment.
We can help you analyze the value of your property today versus the long-term benefits of renting. If you can use the equity in your property in another way that outpaces the performance of the real estate market, you should. If you don’t have anything better to do with the money and the neighborhood is rising in value, hang on – real estate can be a great investment if you know how to correctly read the market.
6) Uncle Sam wants a piece of the action.
Before taking any action regarding your inherited property, it is crucial to seek the advice of tax and legal professionals. Inheriting property can have significant property and income tax consequences that can significantly affect the cost of owning and managing your investment. Therefore, it is vital to discuss your inheritance with professionals who can provide you with valuable insights and guidance on the tax implications of your inherited property. By understanding the tax implications of your inheritance, you can make informed decisions and take appropriate actions to minimize your tax liabilities while maximizing the value of your investment.
7) Consider all your options.
If you are interested in renting and selling your property simultaneously, we may be able to assist you in structuring a lease-option agreement. This type of agreement allows you to rent out the property while also giving the tenant an option to purchase the property at a future date. While these types of deals can be complicated, our investment experience in South Saint Paul can help you navigate the process and achieve success. By exploring a lease-option agreement, you can potentially benefit from the advantages of both renting and selling, ultimately maximizing the value of your investment.
8) Compare a few scenarios.
We are here to assist you in determining the value of your property near South Saint Paul. We can help you determine three different values: the current market value if you sold the property without doing any work, the highest possible price that the market can bear, and the estimated value of the property if you decide to keep it as a rental, along with associated costs. By having a clear understanding of the different values of your property, you can make informed decisions regarding whether to sell or keep the property and maximize the value of your investment. Our expertise and knowledge of the South Saint Paul real estate market can help you achieve your investment goals.